BrainTrust Query: Where Are the Merchants?
by Bill Emerson, President, Emerson Advisors
has always had its tough periods but, in living memory at least, nothing
as extended or as broadly based as the current period. The
discussions and commentary these days all seem to focus on things like
internet strategies, inventory strategies, Black Friday strategies, social
media, CRM, new technologies – worthy topics all. The
one thing that is not being discussed is the most fundamental element
of retailing – the merchandise.
apparel for instance. Go
into any regional mall; apparel and accessories are still the dominant
category of merchandise in terms of square footage and inventory investment.
But the merchandise offering is stale – same fabrics, same colors, same silhouettes,
basically the same thing that’s already in your closet.
of the basic requirements in retail success is to offer the customer
something that excites them enough to part with their money. It
seems that today the answer is to put out lower quality merchandise and
then promote it like crazy – coupons, interlocking one-day sales, early
bird specials, and so on ad nauseum.
assortments belong to the merchants. What makes a great merchant in today’s
environment and where are they?
find the great merchants, you look for those having the most success
without having to rely on POS price promotions. Is
there anybody out there that fits this bill? Well,
it’s estimated that Amazon will sell 500,000 Kindles this year at $300+
discount there. It’s estimated that Apple
will sell over 45 million iPhones this year. No
discount there. The
Apple 4-wall stores, from the day they opened, have completely reset
sales per square foot standards, moving the bar from hundreds of dollars
per foot to thousands. No
Black Friday specials there. They’re
in the same malls as the apparel stores.
about apparel. Any
examples there? Well,
Mickey Drexler has taken J. Crew from a moribund company to a thriving
folks at Buckle, American Eagle, and Urban Outfitters are doing fine.
do Jeff Bezos and Steve Jobs have in common with Mickey Drexler? They
understand that, in the end, it’s all about the product. It’s
all about offering innovative products that excite their customers enough
to part with their money.
the other apparel merchants figure this out, expect continued poor performance
and disappointing sales.
Questions: Have merchandising skills eroded? If so, what’s causing the
decline? Where are the great merchants today and how has the merchandising